Post Session: Quick Review

Indian equity markets witnessed volatility on Monday’s trading session and ended with minor losses. Markets struggled to take position in a day. Investors were cautious about the data of HSBC Composite Purchasing Managers' Index (PMI) Flash, HSBC Manufacturing PMI Flash, HSBC Services PMI Flash, scheduled to be released on October 24. As for broader indices, the BSE Mid cap index and Small cap index ended with deep cut. 

Markets made positive start but failed to hold opening gains and entered into red. Traders were concerned as data shared by the Reserve Bank of India (RBI) showed that India's foreign exchange reserves have experienced a notable decline for the second consecutive week, dipping by $10.7 billion to stand at $690 billion as of October 11. Some cautiousness also came as the NCAER-NSE Business Expectations Survey showed that economic activity continued to show dynamism in the second quarter of 2024-25, though at a moderated pace. Markets continued their weak trade in afternoon session. Sentiments remained weak, as a report by National Stock Exchange highlighted that the revenue disparity among Indian states continues to be significant, while some states have shown revenue growth in FY25 but others have reported a revenue contraction. In last leg of trade, indices managed to attain green terrain for brief period of trade but selling in dying hour of trade forced markets to end in red.

On the global front, European markets were trading lower amid ECB policymaker Gediminas Simkus said that rates could get lower than the natural level between 2 percent and 3 percent, if a fall in inflation becomes entrenched. Asian markets ended mixed following the broadly positive cues from Wall Street on Friday, as traders trimmed their bets on US Fed interest rate cuts this year amid following the largely upbeat batch of US economic data last week. Back home, government has set foodgrain production target of 341.55 million tonnes (MT) in 2024-25 crop year (July-June). Out of these, rabi season foodgrain production projected at 164.55 MT for the 2024-25. The foodgrain production for kharif and summer season crops are estimated at 161.37 MT and 15.63 MT respectively.

The BSE Sensex ended at 81,151.27, down by 73.48 points or 0.09% after trading in a range of 80,811.23 and 81,770.02. There were 9 stocks advancing against 21 stocks declining on the index. (Provisional)

The broader indices were trading in red; the BSE Mid cap index declined by 1.63%, while Small cap index was down by 1.51%. (Provisional)

The only gaining sectoral indices on the BSE were Auto was up by 0.27%, while Oil & Gas down by 1.68%, Industrials down by 1.65%, Realty down by 1.52%, Metal down by 1.44% and Power was down by 1.42% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were HDFC Bank up by 2.83%, Asian Paints up by 1.58%, Mahindra & Mahindra up by 0.91%, Reliance Industries up by 0.76% and Maruti Suzuki up by 0.46%. On the flip side, Kotak Mahindra Bank down by 4.29%, Bajaj Finserv down by 3.05%, Indusind Bank down by 2.86%, Adani Ports down by 2.04% and Ultratech Cement down by 1.93% were the top losers. (Provisional)

The CNX Nifty ended at 24,781.10, down by 72.95 points or 0.29% after trading in a range of 24,679.60 and 24,978.30. There were 15 stocks advancing against 35 stocks declining on the index. (Provisional)

Meanwhile, with the retail inflation is ruling still at high level, the Reserve Bank of India (RBI) Governor Shaktikanta Das has said that interest rate cut this stage would have been “premature” and “very very risky”, and he added that future monetary policy action would depend upon the income data and outlook. He said the September inflation was high and the next print too is expected to remain elevated before moderating. 

Refusing to give any indications about rate cuts in future, he said the central bank would take action on the basis of the incoming data and outlook. He also said the Reserve Bank does not act like a policeman, but it maintains tight vigil on the financial market and takes regulatory action whenever necessary.

Earlier this month, the RBI continued to maintain the status quo in the short-term lending interest rate (repo), citing inflationary concerns, though it changed the monetary policy stance to neutral. The next bi-monthly monetary policy will be announced on December 6.

The top gainers on Nifty were Bajaj Auto up by 4.34%, HDFC Bank up by 2.79%, Asian Paints up by 1.91%, Mahindra & Mahindra up by 1.15% and Eicher Motors up by 0.94%. On the flip side, Tata Consumer down by 6.97%, Kotak Mahindra Bank down by 4.37%, Bajaj Finserv down by 3.38%, BPCL down by 3.17% and Indusind Bank down by 2.89% were the top losers. (Provisional)

European markets were trading lower; UK’s FTSE 100 decreased 7.05 points or 0.08% to 8,351.20, France’s CAC fell 44.6 points or 0.59% to 7,568.45 and Germany’s DAX was down by 103.63 points or 0.53% to 19,553.74.

Asian markets settled mixed on Monday due to concerns overheightened tensions in the Middle East and Europe and uncertainty over the USpresidential election. Japanese shares weakened marginally even after anotherwinning close on Wall Street. Investors are awaiting Japan’s general electionat the end of this week. Meanwhile, Chinese shares rose as Chinese banks cuttheir benchmark lending rates after easing by the central bank at the end ofSeptember, part of a series of stimulus measures aimed at reviving economicgrowth and halting a housing market slump. The one-year loan prime rate waslowered to 3.10% from 3.35%, while the five-year LPR was reduced to 3.60% from3.85%.